ORDER
FOR THE REASONS stаted in the Report and Recommendation of the United States Magistrate Judge, and upon an independent review of the file, it is
ORDERED AND ADJUDGED that the Plaintiffs Motion for Class Certification [Docket No. 12] is GRANTED. It is
FURTHER ORDERED AND ADJUDGED that all pending motions that have not heretofore been ruled upon, except for the Defendant’s Motion for Protective Order to Prohibit the Deposition of John D. Zeglls, Esq. [Docket No. 136], are DENIED as moot.
REPORT AND RECOMMENDATION
GARBER, United States Magistrate Judge.
THIS MATTER is before this Court on Plaintiffs Motion for Class Certification. An Order of Reference was entered by United States District Judge Joan Lenard on April 12, 1996. The case was subsequently transferred to United States District Judge Ke-hoe. This Court has reviewed the numеrous submissions by the parties and held a lengthy hearing on September 30,1997.
ALLEGED FACTS
AT & T has for many years, upon customer’s request, installed or connected two or more phone lines in homes and businesses throughout the United States. In order to install two or more phone lines to multiple telephone sets at a home or office, AT & T would utilize what is known as “key common equipment -1st 4 lines” (“key equipment”).
Plaintiff Lenore Deutch Singer (“Singer”) had two fines installed in her home utilizing a single key equipment unit. Singer received two separate bills for the two lines installed in her home. Both bills reflected monthly charges for the leasing of key equipment. In essence, Singer was allegedly billed twice for the same equipment.
Singer instituted this class action on her behalf and on behalf of all persons and entitiеs overcharged for key equipment by AT & T after January 1,1984.
On August 21, 1996, this Court deferred ruling on Plaintiffs Motion for Class Certification, and allowed discovery limited solely to the certification issues. As a result of such discovery, AT & T produced spreadsheets from its computerized billing system identifying customers that were billed more than once per key equipment at the same installation location address in a single billing cycle. The spreadsheets provided a fist of 30,000 past and present AT & T customers who were billed twice for key equipment at the same installation location address in a single billing cycle.
DISCUSSION
Class actions serve three essential purposes: (1) to facilitate judicial economy
“Under Federal Rule of Civil Procedure 23, a class action determination is left to the sound discretion of the district court. The district court’s decision is reversible only when it abuses its discretion.” Jaffree v. Wallace,
I. Class Definition.
Rule 23 governs the certification process. Before considering the requirements of Rule 23, however, a court' must determine whether a class exists that can adequately be defined. DeBremaecker v. Short,
It is generally acknowledged that a class must be capable of ready identification. De-Bremaecker,
The definition requirement is problematic. “Not only is Rule 23 silent as to what constitutes a class, but the courts have not attempted to provide an exact definition of the term.” 7A CHARLES A. WRIGHT, ET AL., FEDERAL PRACTICE AND PROCEDURE § 1760 (2d ed.1986). The only requirement is that the description of the class be sufficiently definite to enable the court to determine if a particular individual is a member of the proposed class. Pottinger v. City of Miami,
AT & T ferociously opposes class certification on the basis that Singer cannot adequately define a class. Singer seeks certification of all lessees of key equipment throughout the United States who were billed by AT & T more than once per billing cycle for key cоmmon equipment from Janu
This Court finds that Singer has adequately defined the Class. Singer has produced evidence indicating < that AT & T had a nationwide uniform billing procedure of charging customers once for key equipment рer physical location. Singer has defined the class pursuant to spreadsheets provided by AT & T listing customers who were billed more than once per key equipment per physical location. The mere fact that AT & T alleges that it can justify double billing some of the customers, does not render the class indefinite, but is merely a defense to liability.
II. Requirements for Class Certification.
Rule 23 of the Federal Rules of Civil Procedure governs the certification and maintenance of class actions. Under Rule 23(a), a plaintiff must initially satisfy four threshold requirements. The requirements are commonly known as numerosity, commonality, typicality and adequaсy.
Once the requirements of Rule 23(a) have been satisfied, a plaintiff must then demonstrate that the action sought to be certified falls within one of the categories set forth in Rule 23(b). Kirkpatrick,
The court finds that questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to all other available methods for the fair and efficient adjudication of the controversy. The matters pertinent to the findings include:
(A) the interest of members of the class in individually controlling the prosecution or defense of separate actions;
(B) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class;
(C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum;
(D) the difficulties likely to be encountered in the management of a class action.
See Fed.R.Civ.P. 23(b)(3).
In determining whether the named plaintiffs have met their burden, the court’s inquiry is limited to whether the requirements of Rule 23 have been satisfied; therefore, the court shall not consider the merits of the plaintiffs’ claims. In re Amerifirst,
A. The Requirements of Federal Rule of Civil Procedure 23(a) are Satisfied.
(1) The Class is Sufficiently Numerous that Joinder of All Members of the Class is Impracticable.
A plaintiff need not allege the exact number and identify all of the class
Singer relies on the spreadsheets produced by AT & T that contain 30,000 customers who were billed twice for one unit of key equipment at a single site. AT & T contends that the spreadsheets do not establish numеrosity because some of the customers contained therein were correctly billed.
AT & T’s argument does not defeat the presence of numerosity. The spreadsheets contain the names of approximately 30,000 customers who live throughout the United States. The fact that the potential class members are geographically scattered indicates that joinder is not only impracticable, but in all likelihood impossible. Additionally, whether or not AT & T can justify double billing some of the customers addresses the merits of the case and is irrelevant at this juncture. Singer has demonstrated that a significant number of customers were billed twice for rental of one unit of key equipment. Additionally, Singer has also presented evidence showing that some customers were wrongfully over billed. Consequently, it is difficult to imagine that AT & T could justify multiple billings of 30,000 customers. Moreover, even if AT & T could justify a majority of the over billings, a .sufficient number of claimants in geographically distinct locations would remain thereby satisfying numerosity. See Philadelphia Electric Co. v. Anaconda American Brass Co.,
(2) Commonality of Questions of Law and Fact.
The second prerequisite of Rule 23(a) requires that there be questions of law or fact common to the class.
AT & T attacks commonality on two grounds. First, AT & T asserts that the members of the class will be subject to individualized defenses on the grounds that there are at least three different scenarios under which AT & T could have properly billed a customer multiple times for one piece of key equipment аt a single location. Second, AT & T asserts that commonality does not exist because the standard billing structure it utilized resulted from a conversion process by
Many courts have held that where a common scheme of deceptive conduct is alleged, common questions of law and/or fact will exist. See Green v. Wolf Corporation,
This Court finds that the commonality requirement of 23(a)(2) has been met by Singer. Singer throughout her Complaint alleges that this action is the result of AT & T’s standardized billing practices. Where such allegations are made, common questions are usually found. Green v. Wolf Corporation,
This Court finds that the overarching issue of whether AT & T over billed class members is a question of fact and law that is common to the class. This Court believes that the over billing issue in and of itself is sufficient to warrant a finding of commonality. However, this Court finds additional questions of law and fact that support commonality. For example, the following common issues are raised by the Complaint:
1. Whether a contract existed between AT & T and the lessors of the key equipment, and if so, whether AT & T breached the contract by over billing.
2. Whether federal RICO law is applicable to this case.
3. Whether the requirements of federal RICO have been met.
4. Whether AT & T committed fraud.
5. Whether Plaintiffs were damaged by AT & T’s conduct.
6. Whether AT & T breached its duty of good faith and fair dealing as to members of the Class.
7. Whether AT & T was unjustly enriched.
Consequently, this Court finds that the commonality requirement of 23(a)(2) is met because there are a substantial number of questions of fact and law that are common to the global class. The Court does not overlook the fact that there may be some individual issues in this action. However, these individual issues do not outweigh the substantial number of common questions. The issue of common question predominance will be revisited below in the Court’s analysis of Rule 23(b)(3).
The typicality requirement of Rule 23(a)(3) has been observed to be a redundant criterion and some courts have expressed doubt as to its utility. While some courts consider typicality synonymous with the commonality requirement, other courts equate typicality with adequacy of representation. Alfus v. Pyramid Technology Corp.,
The Eleventh Cirсuit Court of Appeals has indicated that its understanding of the role of Rule 23(a)(3) is as follows:
Although the considerations of subsections a(2), a(3), and a(4) tend to overlap, see De La Fuente v. Stokely-Van Camp. Inc.,713 F.2d 225 (7th Cir.1983); 7 C. WRIGHT & A. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1764 (1972), “subsection a(3) primarily directs the district court to focus on whether named representatives’ claims have the same essential characteristics as the claims of the class at large.”713 F.2d at 232 . Moreover, “[t]he typicality requirement may be satisfied even if there are factual distinctions between the claims of the named plaintiffs and those of other class members.” Id.; Penn v. San Juan Hospital, Inc.,528 F.2d 1181 , 1189 (10th Cir.1975). Thus, courts have found that a strong similarity of legal theories will satisfy thе typicality requirement despite substantial factual differences.
Appleyard v. Wallace,
“In other words, there must be a nexus between the class representative’s claims or defenses and the common questions of fact or law which unite the class.” Korberg v. Carnival Cruise Lines, Inc.,
AT & T once again attempts to undermine certification on the basis of alleged individualized factual issues that supposedly are of such magnitude that they overwhelm the cоmmon issues. AT & T alleges that the multiplicity of individual situations under which a customer might legitimately be billed more than once per billing period defeats typicality. Additionally, AT & T argues that Singer’s claims are not typical of the class because she received residential service and many of the class members were businesses. AT & T also attempt to defeat typicality based on the fact that Singer already received a partial refund.
AT & T’s concerns with respect to individualized factual issues do not defeat typicality. As indicated supra, typicality turns solely on whether the plaintiff and the class have an interеst in prevailing on similar claims. The typicality requirement does not demand factual homogeneity. Therefore, the existence of factual differences does not defeat typicality. The legal theories and basis of the claims of Singer and the members of the class are identical. Moreover, the theories of liability and the type of relief sought are the same irregardless of whether or not a customer received residential or business service. Finally, this Court notes that Singer received only a partial refund and to recover further will have to prove the same elements as customers who have not been refunded at all. This Court concludes that Singer’s interests are aligned with the class and that typicality is undoubtedly satisfied.
Rule 23(a)(4) requires the movant to show that the representative parties will fairly and adequately protect the interest of the class. Courts traditionally hold that, in order to satisfy this requirement, it is necessary to determine: (1) that the plaintiffs attorney is qualified, experienced, and will competently and vigorously prosecute the suit; and (2) that the interest of the class representative is not antagonistic to or in conflict with other members of the class. Griffin v. Carlin
The attorney-comрetence prong involves questions of whether representatives’ counsel are qualified, experienced and generally able to conduct the proposed litigation. Griffin,
AT & T challenges Singer’s ability to adequately represent the class. This challenge is based on alleged antagonist interests amongst the class. Specifically, AT & T contends that the interests of the class members are divergent because some members, like Singer, have received a partial refund not including interest, others have received partial refunds including interest and some have no refunds at all.
AT & T’s arguments are without merit. Whether or not a class member received a partial refund or no refund is irrelevant to the adequacy inquiry. All of the members of the class are seeking recovery on the same grounds. The mere fact that some members are seeking partial recovery instead of full recovery or that some members are seeking interest and others are not does result in antagonism amongst the class. Therefore, this Court finds that Singer adequately represents the interests of the class. See Guarantee Ins. Agency Co. v. Mid-Continental Realty Corp.,
B. Rule 23(b).
A plaintiff seeking class certification must also satisfy one of the three subsections of Rule 23(b). Singer seeks certification under subsection (3) of Rule 23(b). Under that subsection, a class may be certified if:
the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to the available methods for the fair and efficient adjudication of the controversy. That matters pertinent to the findings include: (A) the interest of members of the class in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already commenсed by or against members of the class; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; (D) the difficulties likely to be encountered in the management of a class action.
Fed.R.Civ.P. 23(b)(3).
(1) Predominance.
The predominance issue focuses on the number and significance of common issues. This rule does not require a complete absence of individual issues. Cox v. American Cast Iron Pipe Co.,
AT & T once again reiterates its position that the individualized issues are of such magnitude that the common issues cannot pоssibly predominate. The alleged individualized issues revolve primarily around the possible billing exceptions whereby cus
(a) The Rico Claim.
The Eleventh Circuit has held that under the civil enforcement provision of RICO, when the alleged predicate act is mail or wire fraud, the plaintiff must have been a target of the scheme to defraud and must have relied to his detriment on misrepresentations in furtherance of that scheme. Pelletier v. Zweifel,
Courts have taken two different approaches in determining whether to certify class actions alleging RICO claims. Class certification is allowed in instances where class-wide reliance may be presumed based on a uniform written misrepresentation. Smith v. MCI Telecommunications Corp.,
In the instant case, AT & T implemented a nationwide billing procédure whereby each customer would be billed once per key equipment per physical location. AT & T indicated to customers that its billing procedures, for leased equipment subsequent to the bell break-up, would be uniform. AT & T made this representation in writing via a price predictability plan and through monthly bills. This Court finds that the uniform written price representation contained in the price predictability plan and in customer’s monthly bills provide a sufficient basis upon which reliance may be presumed. This Court further notes that it is not necessary to examine each class member’s subjective belief. The leasing of key equipment, consisting of a box and wires, does not involve aesthetic choices. Rather, it merely involves leasing the equipment at a represented price. In other words reliance on. a price predictability plan and/or the price billed. Therefore, this Court concludes that the facts of this case lend themself to a presumption of reliance on the part of the class.
(b) Choice of Law With Respect to State Claims.
In addition to the civil RICO count, Singer has alleged various state law causes of аction: breach of contract, unjust enrichment, and breach of the duty of good -faith and fair dealing. AT & T maintains that the potential applicability of the laws of fifty different states precludes class treatment of Singer’s state law claims. AT & T argues in the alternate that even if the applicable state laws are uniform, individual issues predominate thereby precluding certification.
It is well-established that consideration of choice of law issues at the class certification stage is generally premature. Many courts find that it is inappropriate, to decide choice of law issues incidеnt to a motion for class certification. In re Kirschner Medical Corp. Sec. Litig.,
In the instant case, AT & T’s argument that differing laws will apply to different claimants is merely rhetoric at this juncture. AT & T has failed to demonstrate that choice of law rules would mandate the application of the law of fifty states. The case upon which AT & T relies merely stands for the prоposition that the forum state cannot automatically apply its law if it materially conflicts with
(2) Superiority of the Class Action.
In addition to finding that common questions predominate, the court must also find that a class action is the superior method of adjudicating the dispute. If another available method of handling the controversy appears better suited for а particular action then the action should not be allowed to proceed under 23(b)(3). See CHARLES A. WRIGHT, ARTHUR R. MILLER & MARY K. KANE, FEDERAL PRACTICE AND PROCEDURE: CIVIL § 1777 at p. 519 (1986). Subdivision (b)(3) lists four factors that the court should consider in considering the superiority issue:
(A) the interest of members of the class in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class; (C) the de-suability or undesirability of concentrating the litigation of the claims in the particular form; (D) the difficulties likely to be encountered in the management of a class action.
A review of the factors listed above reveals that a class action is the superior method of adjudicating this controversy. There are potentially 30,000 class members a majority of which will not, in all likelihood, pursue individual lawsuits. The amount in controversy for each individual potential class member is minimal. Additionally, this Court notes that it would be extremely costly for individuals to proceed against a large corporation such as AT & T. Finally, there is nothing to indicate that any individual members or other classes have filed suit with respect to the controversy at hand against AT & T. Therefore, there appears to be no threat of inconsistent adjudications. In fact, it would seem desirable, in light of the number of potential claimants, to concentrate this action in this forum in order to prevent the duplication of effort and possible inconsistent results. Lastly, there are no unsurmountable difficulties with managing this case as a class action. Choice of law, reliance and causation issues may create complications during the course of this litigation, however, the potential difficulties are no where near the magnitude of problems that could arise from 30,000 separate actions. Therefore, this Court concludes that a class action is the superior method for the adjudication of this controversy.
RECOMMENDATION
This Court respectfully recommends that Plaintiffs Motion for Class Certification be GRANTED.
The parties have ten (10) days from the date of this Report and Recommendation to file written objections, if any, with the Honorable James W. Kehoe, United States District Judge. See 28 U.S.C. § 636 (1991). Failure to file timely objections may bar the parties from attacking on appeal the factual findings contained herein. LoConte v. Dug-
Notes
. Due to advancements in technology, key equipment, for the most part, is no longer utilized. However, formerly installed key equipment is still in usе in many homes and businesses across the United States.
. In the Spring of 1993, Singer complained to AT & T about the double billing. In response, AT & T issued two checks; one for $2,957.19 and another for $20.30. Singer is maintaining this action even though she received the checks from AT & T because there is no indication that the refund she received is complete payment for all of the overcharges, and the refunds do not include interest or profits earned by AT & T on the money that was improperly charged and held.
. Rule 23(a) provides that:
(1) the class must be so numerous that joinder of all members is impracticable;
(2) questions of law or fact common to the class must exist;
(3) the claims or defenses of the representative parties must be typical of the claims or defenses of the clаss;
(4) the representative parties must fairly and adequately protect the interest of the class.
. The Court recognizes the similarities between the common-issue requirement in 23(a)(2) and the predominating common issue requirement in 23(b)(3). ’A few courts do not draw a distinction between the two requirements in actions brought pursuant to 23(b)(3) because 23(a)(2) is normally satisfied anytime courts find that the more stringent standard in 23(b)(3) has been met. See 7A CHARLES A. WRIGHT, ARTHUR R. MILLER & MARY K. KANE, FEDERAL PRACTICE AND PROCEDURE: CIVIL § 1763 at p. 227 (1986). Despite the similarities between the two elements, this Court will analyze them separately.
. AT & T once again argues that the state law claims create individualized issues that preclude class certification. A & T's argument is related to the merits of the case and is premature at this juncture.
